During my estimating seminars of which over 3,000 Australian and New Zealand plumbers have now attended, the most interest is in Labour. For some reason contractors find it difficult to appreciate how to calculate labour at the time of tender/bid. The next four parts cover the topic.

Labour should be viewed as the purchase and sale of a product such as a basin, bath or pipe, which we expect to sell for a profit.

How to Express Labour
In estimating terms, labour is expressed in hours rather than a dollar value. While the cost of labour will change from job to job and certainly increase over the years, the time it takes to carry out a particular task will remain constant for the next ten, twenty or even fifty years (with the exception of new technology).

It is common practice to say a particular task takes 10 min, 25 min, 40 min, one hour etc, however when recording such times labour must be expressed in decimals of an hour. Which will make the calculating of the tender/bid labour easier; also it is necessary to use decimals when entering the times on a computer.

The result for the examples above when expressing labour as hours:

Recording Times
A most important part of labour in the tender/bid process is being consistent, if a tender/bid is lost, one can reasonably assume it will be because of the difference in opinions as to how long it takes to carry out a task. If a 100mm /4" pipe takes 0.50 hrs per metre/foot to install and a 50mm pipe takes 0.32 hrs per metre/foot it is reasonable to assume an 80mm /3" pipe will take less than the 100mm /4" but more than a 50mm /2" pipe. (Like everything there are exceptions).

A similar situation applies for fittings. Junctions have three joints to complete where bends have only two, however it does not follow that the bend will take one third less time. There are certain functions to be carried out for both (these are detailed Part 3) such as taking delivery of the fittings, transporting to the site location, setting out and the cutting of the pipe once. The only actual difference is, one less joint to clean and complete. Therefore it is a reasonable assessment that the bend will take 20% less time and not 33%.

Times need to be recorded to ensure consistency. If we were to ask ourselves twenty questions today relating to the time it would take to install various items, the answers given three weeks down the track would be very different.

Therefore it is important to record labour times in a spreadsheet format, which highlights the time differences between the various sizes and materials for pipes and fittings.